hanging in the balance, page-7

MAKO is as much a gamble as an investment.

You have to look at possible scenarios and risk-weight these according to your own best estimates.

Here is an example base on estimated likelihoods of MAK (and corresponding MAKO value) price in the 1-2 weeks BEFORE expiry date (last few days - ie some chance of price rise with expected bullish ann. and last chance to sell MAKO) - these are only guesstimated probabilities, think of your own equally bad guesses for your own analysis. Excel is great for this.



I haven't included the complexity involved with tax here, which relatively reduces option value for >12 month holders (IE optionholders that convert reset the CGT date to the option conversion time whereas heads would already be nine months in by then).

I have been deliberately pessimistic in likely SP future to allow for repeat market meltdown (25% chance IMO) and risk of the enterprise not being viable. I have also been somewhat pessimistic on the upside, with IMO a much better chance than I have used here of values over $1.00.

Note this method takes into account all outcomes (I have assumed zero chance of a SP >$2.50 in nine months)

My numbers suggest MAKO is a better deal assuming my probabilities are in the correct ballpark.

Based on these numbers the relative extra value of MAKO vs MAK would be zero at a MAKO SP of about 7C.

It is worth doing these numbers for yourself with any share or option you buy based on a best estimate of likelihood.

Please don't criticise my probability assumptions as rubbish - they are off the top of my head and only for illustrative purposes.